The truth is that the MPC and all other sequencer hardware (909, 808, their predecessors, all keyboard workstations) were a step in this direction.
In an age where most adults are assumed to own a computer (and most teens/children are assumed to at least have access to one), computer software is simply the new phase in production.
Old habits die hard, but at least we're not using rotary-dial phones anymore.
A computer sequencer allows you to use quality MIDI controllers in the same workflow as hardware, but with the added power of more/higher-quality sounds/synths and the ability to fix the timing of individual notes on-the-fly to salvage what would otherwise be an excellent take.
My opinion is that products that are a hybrid integration like Maschine, Kore, Cakewalk V Studio, etc are the future of production tools.
You move away from hardware limitations but still get the hands on feel. I would expect to see companies like Roland and Yamaha start moving more in that direction with the integration of their workstations and groove boxes.
Access Virus TI is a testament to the trend. Korg's workstations all pretty much integrate with software.
I used to be totally against software, but have come to see the advantages and the fact that I can usually do as much and many times more than I could with my hardware devices, and quicker.
As the midi controllers get smarter, there really is no difference between the two, except maybe the number of pieces required to operate.
Where an mpc can operate with itself and some speakers/headphones, software requires at least a laptop, headphones/speakers and possibly a midi controller (of course some can be operated with the keyboard). But other than that there really is a lot to be said for the current selection of software around.
I really think the more controllers can integrate with the software, the more the lines will be blurred between the two.